Millions of consumers are set to experience significant adjustments to contactless payment card limits following the recent announcement by the financial regulator.
Currently capped at £100, contactless payments require a PIN entry for transactions exceeding this amount. However, the Financial Conduct Authority (FCA) has disclosed that starting March 19, 2026, banks and payment providers will have the authority to establish their own limits.
Moreover, companies are being urged to offer customers the option to customize their limits or disable contactless payments entirely. Many card issuers already permit clients to modify their personal contactless limits or deactivate the feature altogether.
With the existing regulations, multiple contactless transactions under £100 are typically allowed in a day, but surpassing £300 may prompt a PIN verification.
Under the revised guidelines, businesses will have the flexibility to consider revising this policy at their discretion. The FCA initially introduced these proposals in a letter to the Prime Minister in January, followed by a consultation period until mid-October.
The evolution of the contactless limit saw it incrementally rise from £10 in 2007 to £100 in 2021, reflecting the changing landscape of consumer payment preferences.
According to the FCA, an estimated 85% of individuals in the UK engage in monthly contactless card transactions, highlighting the widespread adoption of this payment method.
David Geale, the FCA’s executive director of payments and digital finance, emphasized the importance of adapting rules to accommodate evolving payment preferences, ensuring flexibility for both businesses and consumers.
Kate Nicholls, chairwoman of UKHospitality, welcomed the change, noting its potential to enhance customer convenience in various sectors. She highlighted the growing preference for contactless payments and the benefits of lifting the limit for expediting transactions.
Jana Mackintosh, managing director of payments and innovation at UK Finance, expressed support for the FCA’s decision to grant banks and payment providers more flexibility regarding contactless limits in the future. While immediate changes to the £100 limit are not anticipated, any future adjustments will prioritize maintaining robust security and fraud prevention measures.